The home buying experience can be an overwhelming experience that can be exhilarating, fun, stressful and exhausting. The process of securing a mortgage, successfully bidding on a home and completing the transaction can be lengthy, complex and involve seemingly endless professionals. Those professionals may include a buyer’s agent, a loan officer, a home inspector, title […]
What you need to know about down payment assistance
At SmartMortgage.com, we work hard to help you find the best loan option that makes buying a home a smooth experience. To achieve that goal, we collaborate with local agencies that offer affordable down payment assistance.
Why get down payment assistance?
A down payment is a percentage of home’s sales price that is required upfront upon purchase. Although the “traditional” 20% down standard seems widely known, there are many loan options available to homebuyers that may require little to no down payment.
That being said, saving up for any down payment can be challenging for potential homebuyers, which is where down payment assistance comes in.
Down payment assistance programs are usually locally funded programs administered by state or municipal agencies that help homeowners who may not have the cash on hand needed to buy a home. There are several kinds of down payment assistance, including:
- Grants: Funds that you do not need to pay back
- Low interest or interest-free second mortgages: A loan with low or no interest rates, deferring payments over a specific period.
- Special mortgage programs: Programs that offer specialized down payment assistance, which differs the monthly payments depending on the lender and type of loan.
Down payment assistance programs can benefit you as a buyer by not only helping you get the home you want but can help you save that down payment for home improvements or reserves in your bank account.
Who is eligible for these programs?
Most down payment assistance programs are geared to first-time buyers, but some are open to repeat buyers. Requirements can vary from program to program, here are some common ones:
- Take a homebuyer education course
- Meet income limits
- Not have owned a home before or in the last three years
- Be located in a specific geographic area
- Use the home for your primary residence
Finding the right program with help from SmartMortgage.com
To find a down payment assistance program, ask your lender at SmartMortgage.com. Not only will they be able to recommend where to start, but they help you understand your eligibility requirements. For anyone wanting more information on these guidelines, contact us at SmartMortgage.com to help you determine which down payment assistance programs are best for you.